An increasingly shrill battle for the islands, named the Diaoyu's by China and the Senkaku's by Japan, has blown up this year, with nationalists on both sides trying to plant territorial flags and stir up public anger.

The stakes were escalated by Shintaro Ishihara, the rabble-rousing governor of Tokyo, who suggested that the Japanese government buy three of the islands from the Kurihura family, who claim the Japanese deeds. Japan should stand up to China, he intoned, or face becoming a "second Tibet".

As Japanese newspapers reported the purchase plan was close to fruition, with a Y2.05 billion (£16.4 million) price agreed on Wednesday, the Chinese government voiced its rage.

"In disregard of China's solemn representations and firm opposition, Japan single-mindedly pushes forward the island purchase process which severely harmed China's territorial sovereignty and hurt the feelings of the Chinese people," said a spokesman for the Foreign ministry.

"We cannot help but ask where is Japan trying to lead China-Japan relations to?" "The Chinese government is monitoring developments closely and will take necessary measures to defend its national territorial sovereignty," he added.

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Meanwhile, at a meeting with Hillary Clinton in Beijing, China's foreign minister, Yang Jiechi, asserted the country's "plentiful historical and jurisprudential evidence" for its claims to virtually all of the South China Sea.

Several countries have overlapping 200 mile exclusive economic zones in the South China Sea, and tension has been rising all year as the Chinese navy becomes more assertive about policing what it sees as its territory.

Mrs Clinton has urged China to agree a "code of conduct" for all the countries whose coasts border the sea, a move that Mr Yang appeared to approve.

However, on what could be her final visit to China as America's top diplomat, Mrs Clinton had a key meeting with Xi Jinping, who is likely to be the country's next president, cancelled.

Such was the tension surrounding Mrs Clinton's trip to Beijing that many suspected it was a deliberate snub.

Ahead of her visit, the state-run Global Times newspaper said bluntly: "Many Chinese people do not like Hillary Clinton ... She makes the Chinese public dislike and be wary of the United States."

However, Mr Xi, who is likely to be unveiled as the Communist party's top leader after the 18th Party Congress in mid-October, was reported to have injured his back.

He also cancelled his other engagements on Wednesday, including a meeting with Singapore's prime minister, Lee Hsien Loong.